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jacosa 124 posts  |  Last Activity: 10 hours ago Member since: Jan 24, 2000
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  • Reply to

    Things we may hear in the next few weeks

    by jacosa Apr 5, 2016 12:19 PM
    jacosa jacosa Apr 5, 2016 4:30 PM Flag

    Profit is a meaningless number for Incyte, largely because they spend money (visible costs) to increase the value of their intellectual property, which IP sits at cost of acquisition on the balance sheet (invisible earnings).

    The mid-maturity pipeline is promising, but also has problems. Epac in particular looks likely to boost the effectiveness of _other companies'_ targeted drugs, and by a substantial amount. But it has little or no benefit as a single agent. (What does FDA do? how do you sell such a thing?) It makes sense that a JAK-1 specific kinase inhibitor ought to be better than a less-specific drug in some situations, but so far nothing has jumped into the spotlight. Novartis seems satisfied to dawdle along with the cMET candidate. P!3Kdelta inhibition is presumed guilty of on-target toxicity until proved innocent.

    I was MORE shocked that they halted the PaCa trial for futility 12 months into a 14 month study. But originally, the hope for ruxo in PaCa was that it would reduce suffering, not that it would prolong survival. There are potential wheels within wheels here (if the market niche is hospice patients, a survival benefit might actually preclude much of the market from using it). Anyway, there wasn't a survival benefit in colorectal cancer (and paraneoplastic syndrome is not characteristic in CRC); there was at least no large survival benefit in the lung trial (and we have no report on palliation there; para... is intermediate between CRC and PaCa). Nobody will be surprised however this develops, but short of a flat denial of interest, the level of clues we might get this [relatively] early won't be terribly strong.

  • Going into AACR. Incyte will have it's ludicrously-named 'investor presentation' (last year, at least. it was entirely technical with nothing for a non-specialist investor). We can expect SOMETHING all-Incyte to progress to a phase-3-like trial (my guess is a combination of '110 with epac into a phase 2 with optional pivotal continuation, probably against a B cell cancer, but that guess is driven more by business convenience than by any technical issue). There may also be a hint at whether the palliative effects seen in the discontinued cancer / inflammation trials will be followed up. There may be collaborations announced with the PI3K delta drug: apparently the target interests a lot of people, and a safer alternative is much-desired. But there are some things that could plausibly happen separate from AACR. Merck may announce the pembrolizumab + epac trial against melanoma (their choice of timing, but 5 months after they announced that they were going to do it seems reasonable). Incyte may announce whether it is opting in or out of collaborating with Lilly on development of bari against diabetic nephropathy (they recently contrasted this decision with the decision about collaborating on atopic dermatitis, saying that it had to be made much sooner).

    Short-term market effects: Merck p3 positive, Lilly collaboration negative, others neutral.

  • Reply to

    Felder states we are in a bear market

    by ronbbck Apr 2, 2016 7:59 PM
    jacosa jacosa Apr 3, 2016 1:28 AM Flag

    In a very real sense that "fantastic info on RA" is over six months old. The only one of the 4 pivotal trials for which the full publication might alter the message of the topline is RA-BEAM (the 4th)

  • jacosa jacosa Mar 27, 2016 2:34 AM Flag

    Someone contacted investor relations and was told that no milestone has been triggered by the N.I.C.E. action. Only a little unexpected (well, being told ANYTHING unpublished about milestones is more unexpected than the content there).

    Germany is the largest drug market in Europe. Add France, UK, Spain and Italy, and you have half the addressable market in the EU (Italy doesn't seem to cover Jakavi yet). Denmark is quite influential, and before they started revising their rules, so was The Netherlands (when they settle on the new system, it is expected to be a good one).

    I'm still pounding nails over NO UK coverage for intermediate-1 MF.

  • jacosa jacosa Mar 24, 2016 11:12 AM Flag

    I skimmed the announcement on this. Approval, but fairly thin gruel. Despite talk about the importance of fatigue as a symptom of MF, apparent benefit of early treatment and enthusiastic reception by physicians and patients, they recommend use (and allow NHS reimbursement) only for treatment of splenomegaly in intermediate-2 and high-risk MF. They mostly relied on the Comfort-2 follow-up because that study began with a comparison against best available therapy (Comfort-1 is a better study with better-handled follow-up; BAT of that era looks worthless anyway, so why not include comparison against placebo?) The key development that cleared the way was substantial price concessions from Novartis.

    So while I'm sort of happy, I'm not enthusiastic. N.I.C.E. is as bad as ever.

    Still, some sort of N.I.C.E. approval is probably a necessary condition before about $400MM of remaining Novartis milestone payments can be earned, and will probably help in achieving the rest of them. This takes some of the pressure off Incyte to arrange funding for phase 3s in the moderate future.

    The determination can be revised, under its terms, in 3 years.

    Interestingly, the litany of side effects did not include frequent / severe / unusual infections.

    Britain will be a convenient 2nd or 3rd venue for trials of the combination of ruxo with low-dose interferon. (behind Germany and maybe Denmark).

  • jacosa jacosa Mar 23, 2016 5:57 PM Flag

    One of my repeated wails is that INCY is an analyst's worst nightmare. The justifiable price depends pretty sensitively on the sales trajectory of bari...I don't even have a justifiable price for bari (depends on prospects for diabetic nephropathy and atopic dermatitis--something in the $60-120 a pill range, but that's pretty wide). Price depends pretty sensitively on how FDA will treat the epac NDA, too. (If it gets approved the right way, usage expansion trials are MUCH easier to run than if it gets approved the narrowest way). We lost MOST of the "or possibly infinity" possibilities with the cancer systemic inflammation trials, but not all of them. Does anything happen when the estimate of maximum Jakafi sales is officially increased (the old estimate should be met before EoY, still rising)? [probably no effect on stock, price, but a big impact on how analysts will have to present things]

  • Reply to

    Disaster in Rennes

    by jacosa Jan 15, 2016 4:52 PM
    jacosa jacosa Mar 22, 2016 1:57 PM Flag

    I know there are people who don't think this matters to us, but I contend that this may have a meaningful impact on the way clinical trials are run, forever. I can easily imagine that this will encourage more of the burden of proving a drug candidate to move into "phase 2" studies.

    More has come out in conjunction with a lawsuit. These were not the first subjects given multiple doses of the drug, but the first given multiple doses at this high a level. The subjects were in regular contact with each other, increasing the chance that there was a common external contributor to the reaction. The prior animal testing had not included solid measures of effectiveness, which may have led to use of excessively high doses in people. At the time the subjects who suffered less-than-fatal harm were given their third dose of the experimental drug, the available medical report on the dying subject was several hours (about 8) old, and reassuring. He was already worsening by the time the third dose of the drug was given, but the investigators hadn't been updated.

  • While poking around for clues to when we might see papers that could get N.I.C.E. to approve Jakavi already, I found a Haematologica paper from last September summarizing experience in the Comfort cohorts up until then Doi:10.3324/haematol.2014.119545 (the same issue contains a 'Guideline Article' "scorecard" to identify the players in the myelodysplastic syndrome group (probably more interesting to fans of that S,N oligonucleotide)).

    It gives somewhat more survival data than the PPI gives, and in particular it limits possible confounding mechanisms, but it isn't especially encouraging with regard to the chance that future reports on the same group might be enough of a kick to get UK approval. I guess we'll probably need to have clinical experience papers, and probably clinical experience since the specific protocol for dose titration was publicized. Say 1 1/2 - 2 1/2 years. Not within most of our investment time frames.

    What I see as the significance of this is that future milestone payments from Novartis could help pay for the expected bulge in pivotal trial costs anticipated come 2017. (Jakafi sales and the bari approval milestone should see to the beginning of that need, but I'm reluctant to count on rapid bari sell-in for the rest of the need)

  • Reply to

    860,000 shares to be exact!

    by mrdtino Mar 17, 2016 9:03 PM
    jacosa jacosa Mar 18, 2016 12:25 PM Flag

    Sorry. I have a lot of internal dialog (that is, I worry a lot). I claim to be a nearly-pure fundamentalist, but there can be a lot hidden in choice of valuation models.

    Board consensus is clearly still to remain independent until Dr Paul can claim vindication (he held out for a science-driven drug company in the early aughties when business-orientation was peaking). So I see actions by board members and top execs through that filter.

  • Reply to

    860,000 shares to be exact!

    by mrdtino Mar 17, 2016 9:03 PM
    jacosa jacosa Mar 18, 2016 11:44 AM Flag

    Looks to me like a combination of simply trying to make money (way I do the arithmetic, the pipeline is presently valued at zero or a bit less) (Either an optionality calculation or a realistic probability-adjusted NPV calculation would assign a lot more value to bari than my rule-of-thumb valuation. I think the low number is appropriate for kids looking into the window, like us, but someone looking at control-sized investments is better with the more formal approaches) and a warning shot at approaching acquirers (Before you make an offer that'll put Incyte in play, be sure you won't be hurt by a vigorous defense).

  • jacosa jacosa Mar 17, 2016 2:25 PM Flag

    One other thing: he has almost certainly seen Lilly's proposed label for bari, and he said something about a good label when the drug is approved.

    With Incyte's research program looking like it could absorb an infinite amount of money, Incyte locked out of the convertibles market by recent trading halts and serious negotiations already going on with Lilly over non-RA uses of bari, I at least half expect a deal for Lilly to get RA and psoriasis rights (and maybe some others) on Incyte's JAK-1 candidates. Negative evidence of ongoing talks: we've heard nothing lately about IBD, which had been held out previously as the natural target for an anti-inflammatory JAK-1 drug.

  • jacosa jacosa Mar 17, 2016 12:57 AM Flag

    This isn't the time for novel stuff. The most interesting thing was probably that he didn't mention EITHER diabetic nephropathy or atopic dermatitis in connection with the Lilly collaboration, which suggests that the negotiations for research funding in BOTH indications is in a sensitive stage.

    There was some talk about the ruxo vs cancer systemic inflammation program. Absolutely, you had to keep going on PaCa. I'll buy that you had to have trials against other tumors with other drug combinations, but I still don't see that those trials had to be as large as they were.

    It was a bit disingenuous to suggest that the Merck combo study with epac just happened to have enough melanoma patients enrolled to generate a signal calling for follow-up. It was presented at the time it started as a trial mostly against melanoma.

  • Reply to

    More AACR info coming out

    by jacosa Mar 16, 2016 2:10 AM
    jacosa jacosa Mar 17, 2016 12:40 AM Flag

    It's almost all late-breaking clinical, so we don't have full abstracts to tear up. Item of minor interest: JAK-2 inhibition specifically interferes with pathological pathways in glioblastoma. A treatment involving a specific JAK-2 inhibitor and something other than JAK-1 inhibition to moderate the associated toxicity might be useful. I'm pretty sure Incyte has the best library of JAK inhibitors with varying specificities. It's unclear whether hematopoietic agents would ruin the desired effect.

    We DO have Dr Verstovsek's full abstracts. One suggests that bromodomain inhibition may be helpful in AML treatment, but it's VERY early stage, and there are other papers suggesting powerful mechanisms for bromodomain homeostasis; in other words, tumor escape may be rapid.

  • Full text of the regular abstracts and titles of the late-breaking ones released at 4:30 today.

  • Reply to

    PI3K delta inhibitr shake-up

    by jacosa Mar 14, 2016 9:51 PM
    jacosa jacosa Mar 15, 2016 11:45 AM Flag

    I think the decision was more likely inward-looking than outward-looking. For all Incyte's hope, there's not enough clinical data to make a judgment of superiority. It would be especially unsurprising if Gilead's apparent shotgun approach to combinations turned up an instance or two of synergistic adverse events. Inositol phosphorylation is pretty widespread. On that theme, I wouldn't be shocked if a combination of delta with a JAK inhibitor went screwy, but combo with epac would be expected to behave sensibly.

    Motivational speakers tell you to see opportunity. Mr Market is in a different mood/mode.

  • Reply to

    whtat is going on? 2 minutes getting in at

    by option_flyer Mar 15, 2016 7:30 AM
    jacosa jacosa Mar 15, 2016 10:43 AM Flag

    There seems to be a perception that all drug makers, particularly those using specialty pharmacies, are Valeant.

  • Gilead has cut back research on its known-problematic (but US-approved) PI3K delta inhibitor Zydelig (idelalisib). Incyte claims to have an enormously less risky drug candidate against the same target, but at this stage investors are likely to discount the whole category.

    The ongoing studies are open-label, so we may get interim safety reads this year.

  • From the MPR newsletter: "Regeneron and Sanofi announced their Phase 3 study for sarilumab has met its primary endpoint, demonstrating superiority over adalimumab in improving symptoms in patients with active rheumatoid arthritis (RA) at Week 24, in the SARIL-RA-MONARCH trials."

    This is another biologic, but targeting IL-6 pathways. As such, it ought to be synergistic with just about everything. Side effects also ought to get combined, so value of combinations is hard to predict. IL-6 signaling is pretty central to the immune response, so even though the safety results in the study were good, adoption figures to be cautious.

  • Reply to

    Where we are

    by jacosa Mar 11, 2016 12:58 PM
    jacosa jacosa Mar 14, 2016 3:52 AM Flag

    You're [sour] cherry picking. Most likely. the present share price reflects extremely little value imputed to the pre-phase-3 pipeline. I can't imagine that persisting in a hostile takeover atmosphere (the alternative is that it reflects an unrealistically low estimate of eventual ruxo sales, and that wouldn't last in a hostile takeover atmosphere either). Major events have to happen for INCY to get back above $100, but baricitinib approval ought to be major enough. It's possible that the actual start of the pure phase 3 of an epac combo in melanoma (with Merck) may reassure some people who became convinced by the miserable handling of the phase 2 topline that the project was a failure. Thinking a year ahead, a lot depends on what's actually said about the drug industry during the presidential campaign (I don't expect much to be said).

  • Reply to

    Where we are

    by jacosa Mar 11, 2016 12:58 PM
    jacosa jacosa Mar 11, 2016 3:03 PM Flag

    Wellington MAY change the landscape, but BB are definitely in the "Not for sale until at least one non-partnered product launch" camp. Given Wellington's major Philadelphia presence, I strongly suspect some social ties, and that would make them more partial to the same thing. So while I'll go as far as to use "buyable company" price estimation, I think the barrier to a hostile deal remains larger than its surface appearance. And the friendly price remains prohibitive.

VOLC
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